Unexplained wealth orders and tales of the unexpected

May 1, 2018

The time limit to respond to a UWO will be short and set by a judge in the absence of the respondent. FRA Partner Rik Workman and FRA Director Simon Taylor discuss in The Lawyer why clients who might be affected should get their ducks in a row.

It was feared the UK was becoming a haven for unexplained wealth and in 2014 Transparency International began calling for greater power to be given to investigators to seize assets that appeared to be beyond the means of its owner.

On 31 January 2018 these powers were granted. An Unexplained Wealth Order (UWO) is applicable to any property- houses, cars, shares and trusts will all be targets- greater than £50,000. Property can be located anywhere in the world and is irrelevant of when it was required. Once a UWO is made the obligation is on the politically exposed person (PEP) to prove the asset was acquired with lawful sources of income. While this may be straightforward in some cases, it is likely to raise complex financial and legal issues in many others. These powers both strengthen the investigators’ armoury and make a significant contribution to the UK Government’s ‘no safe haven’ commitment for ill-gotten gains

These new powers could be worrying for many PEPs, former PEPs, their families and close associates as they may be required to explain familial wealth over generations, especially considering the time constraint for filling the statement could be as short as 28 days.